Notice that not only has the trajectory of GDP moved up noticeably, the forecasted growth rate for 2013Q4 has moved up. The IMF is also revising upwards forecasted growth for the US in 2014. [1]

Employment seems to be growing more rapidly. In addition to the acceleration in November employment growth, it’s likely that the benchmark revision, to be reported in February 2014, will shift up the trajectory of nonfarm payroll employment and private nonfarm payroll employment. For the first, Figure 2 shows the likely revision, based upon the preliminary benchmark revision (released 9/26).

Figure 2: Nonfarm payroll employment as reported (blue), preliminary revision for March 2013 (red), and household employment series adjusted to conform to payroll concept (green). Source: BLS via FRED, BLS, BLS, NBER, and author’s calculations.Notice that the household adjusted series matches the revised payroll series toward the end; however, the household series is subject to considerably wider variation due to smaller sample, so not too much should be made of this.

Finally, I think the factor that makes the growth more likely to be sustainable going forward, barring another debt-ceiling crisis or some sort of financial crisis overseas, is the fact that real household net worth has nearly reattained pre-crisis levels.

Figure 5: Log real consumption, bn Ch.09$, SAAR (blue, left scale), and log real household net worth, bn Ch.09$ (red, right scale). Net worth deflated by PCE deflator. NBER defined recession dates shaded gray. Source: BEA and Federal Reserve Board via FRED.Despite these positive notes, in this season, it would be wrong to forget those that the recovery has left behind, and particularly those whom some of our policymakers [2] have decided would be better off without our help — namely the 1.3 million long term unemployed who will receive their last unemployment benefit checks on December 28. [3]

So to all — even those who are happy to see extended UI and SNAP cut — a happy holidays.